A broad-based measure of inflation expectations compiled by the Federal Reserve fell last quarter to its lowest level in almost two years, according to data supplied by the central bank on Friday.
The index of common inflation expectations stood at 2.22% at the end of last quarter, down from 2.31% on Dec. 31, 2022 and the lowest level since June 30, 2021, when it stood at 2.18%.
Developed by Fed board economists in late 2020, the index comprises more than 20 indicators measuring the attitudes of consumers, investors and professional forecasters toward future price increases.
This was the third straight quarterly decline in the index after it hit 2.39% in the second quarter last year, the highest level in records dating back to 1999.
Fed Chair Jerome Powell has stressed the importance of keeping inflation expectations in check as the central bank has raised interest rates at the fastest pace in a generation.
By Rich Miller / Bloomberg